In our yesterday’s newsletter we clearly informed you that the market would experience a bounce but it will not sustain at higher levels.

We also informed that the market is expected to go down further on account of several fundamental/liquidity/technical reasons. In the current situation we do not expect a strong bull run at least for the next 2 months. In case the Nifty slips below 8000 then we should consider it as a temporary bear phase for the Indian market which could lost anywhere between 6 months to 24 months.

In one of our recent posts we had clearly mentioned that market would not help short term investors at least in the next few weeks. We also mentioned that the market will teach us the meaning of Kofi Annan’s (ex secretary of United Nations between 1997 and 2006) quote “Knowledge is power. Information is liberating. Education is the premise of progress, in every society, in every family.” Clearly the market is expected to give us adequate time to learn some important lessons to win the current market phase.

Despite a very positive budget the Indian shares have seen heavy selling pressure. However the wealthbull newsletter clearly expected a sell off after the budget. Have you used it? Retail investors are totally confused while the traders are conducting Lakshmi pooja to retain the momentum. Waning momentum is causing lots of problems to the small as well as momentum players. The pick of the strong sell off in yesterday’s market was Jindal Steel which slumped as much as 14 per cent in the morning hours after the government rejected its bids for three coal mines. At the end of the day it recovered some of its losses but still was down by 6 per cent! In a similar fashion Coal India Ltd also fell off 2 per cent after HSBC downgraded the stock to "neutral" from "overweight," citing lower off take and realization. However, at the end of the day it not only recovered all its losses but also closed positively which was cheered by the bulls. Glenmark Pharmaceuticals Ltd fell off 5 per cent after the division bench of Delhi High Court restricted the company from manufacturing Zita and Zita-Met.

Earlier in this month, Reliance Infra agreed to buy 18 percent stake in Pipavav Defence and Offshore Engineering Co. However this news has negatively impacted on the stock price of Reliance Infra as it closed down at 5-week low on concerns that proposed acquisition of equity stake in Pipavav Defence and Offshore Engineering Co Ltd could entail cash outgo higher than presently envisaged. Several other stocks fell off to touch a recent low and (retail) investors (?!) are complaining about the bear hug on the street. It is time that they equip themselves with some ammunition otherwise they will lose out miserably like Tippu sultan. It is better for the retail investors to keep the quote of Kofi Annan on their trading desk as it would help them to know why they are losing out in the market.

All in all it was not a good day for the retail investors and momentum players. Technical analysts are expecting some support close to 8450 levels. Let us check it out in our next edition of the newsletter.